Business Correspondent
A concerning report has revealed that approximately 48% of registered companies in Zimbabwe are not remitting contributions to the National Social Security Authority (NSSA), as mandated by law.
This non-compliance significantly impacts the benefits and services available to retired employees, undermining their financial security.
This information was disclosed during a Social Security Benchmarking Workshop held in Bulawayo, where a Zambian social protection service team is visiting to learn from Zimbabwe’s experiences.
Mr. Shepherd Muperi, the NSSA director of social services, provided an overview of the challenges facing the agency, emphasizing that only 52% of companies are fulfilling their obligations to pay contributions.
Muperi highlighted the implications of this non-compliance, stating that when employers fail to pay, NSSA is still legally required to provide benefits to affected workers, which stretches the agency’s resources. He noted that this situation leads to unfunded benefits, where the contributions from compliant companies are insufficient to cover the needs of all beneficiaries.
The Broader Impact on Social Protection
The lack of compliance has far-reaching consequences, particularly as over 60% of Zimbabwe’s workforce lacks social protection coverage. According to the latest statistics, out of approximately 4.5 million in the labor force, only 1.3 million are covered by NSSA, leaving a significant portion of the economically active population vulnerable to risks such as healthcare costs and loss of income due to illness or disability.
Muperi warned that the absence of social protection not only exposes individuals to poverty but also becomes a burden on the state when these individuals can no longer support themselves. He emphasized the need for a robust social protection system to safeguard citizens against life risks.
Initiatives for the Informal Sector
In response to these challenges, NSSA is working on a program to extend social protection coverage to the informal sector, which has been a significant gap in the current system. This initiative is currently in the report writing stage and aims to provide a safety net for those not covered by traditional employment benefits.
Conclusion
The findings from the workshop underscore the urgent need for improved compliance with NSSA contributions among businesses in Zimbabwe. As the country seeks to enhance its social protection framework, addressing these compliance issues will be crucial in ensuring that all citizens have access to necessary support and benefits.
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